Benchmark Announces First Closing for Its Oversubscribed Offering of Hard Dollar Units and Flow-Through Units
Benchmark Announces First Closing for Its
Oversubscribed Offering of Hard Dollar Units
and Flow-Through Units
Edmonton, Alberta--(Newsfile Corp. - September 18, 2020) -
Benchmark Metals Inc.
(TSXV: BNCH)
(OTCQB: CYRTF) (WKN: A2JM2X) (the "
Company
" or "
Benchmark
") is pleased to announce that it
has closed the first tranche of its previously announced private placement (the "
Offering
") of 16,260,847
hard dollar units at $1.30 (the "
HD Units
"), 2,585,500 flow-through A units at $1.56 (the "
FT A Units
")
and 9,305,040 flow-through B units at $1.75 (the "
FT B Units
"), (the HD Units, FT A Units, and FT B
Units, collectively, the "
Units
") for gross proceeds of $41,456,301, inclusive of $1,365,198 in connection
with the concurrent non-brokered private placement of 618,152 HD Units and 360,000 FT A Units.
The
Company expects a second closing next week to complete the over-subscribed Offering for total gross
proceeds of at least $50,267,662.
Net proceeds of the Offering will be utilized to fast-track the Lawyers gold-silver project towards a
production decision in 2022.
Major milestones and work programs planned over the next two (2) years
include:
Permitting, engineering and baseline environmental activities already in progress;
2020 - drilling expanded up to 100,000 drilling metres;
2021, Q1 - Mineral Resource Estimate;
2021, Q2 - Preliminary Economic Assessment (PEA);
2021 - 200,000 metres of drilling; and
2022 - updated Mineral Resource Estimate and Feasibility Study (FS).
Each HD Unit, FT A Unit and FT B Unit consists of one (1) common share of the Company (a "
Share
")
and one-half (1/2) of a transferable warrant of the Company (a "
Warrant
"). Each Warrant is exercisable
to purchase one (1) additional Share at an exercise price of $1.80 per Share until September 18, 2022.
The brokered Offering is being completed pursuant to an agency agreement dated September 18, 2020
between the Company, Sprott Capital Partners LP as lead agent (the "
Lead Agent
"), Clarus Securities
Inc. and PI Financial Corp. (collectively with the Lead Agent, the "
Agents
").
The Company paid to the
Agents a cash commission of 6.0% of the gross proceeds raised from the brokered Offering, a
corporate finance advisory fee of $1,950 and issued to the Agents non-transferable warrants of the
Company (the "
Compensation Warrants
") exercisable to purchase up to 1,631,894 Shares at $1.30
per Share until September 18, 2022.
Mr. Eric Sprott acquired 7,692,308 HD Units pursuant to resales of securities sold under the Offering.
Prior to the Offering, Mr. Sprott owned or controlled 15,593,334 Shares, and warrants of the Company to
purchase up to an additional 7,796,667 Shares.
Following this closing of the Offering, Mr. Sprott
beneficially owns or controls 23,285,642 Shares and 11,642,821 warrants of the Company, representing
approximately 15.6% of Benchmark's issued and outstanding Shares on a non-diluted basis and would
own approximately 21.7% of the issued and outstanding Shares on a partially diluted basis assuming the
exercise of such warrants.
Mr. Sprott has entered into a written agreement that restricts him from
exercising warrants if such exercise would result in his holding 20% or more of the issued and
outstanding Shares, pending the receipt of disinterested shareholder approval at the next annual
meeting of the shareholders of the Company expected to held prior to the end of 2020.
The HD Units were acquired by Mr. Sprott for investment purposes. Mr. Sprott has a long-term view of
the investment. He may acquire additional securities of Benchmark including on the open market or
through private acquisitions or sell securities of Benchmark including on the open market or through
private dispositions in the future depending on market conditions, reformulation of plans and/or other
factors that Mr. Sprott considers relevant from time to time.
Pursuant to Multilateral Instrument 61-101
Protection of Minority Security Holders in Special
Transactions
("
MI 61-101
"), the acquisition of the HD Units by Mr. Sprott constitutes a "related party
transaction".
The Company has determined that the transaction is exempt from the formal valuation and
minority shareholder approval requirements of MI 61-101 by virtue of the exemptions contained in
Sections 5.5(a) and 5.7(1)(a) of MI 61-101, as neither the fair market value of securities issued to Mr.
Sprott nor the consideration paid by Mr. Sprott exceeded 25% of the Company's market capitalization.
The Company did not file a material change report in respect of the transaction 21 days in advance of
closing of this acquisition by Mr. Sprott because insider participation had not been confirmed. The
shorter period was necessary in order to permit this acquisition in a timeframe consistent with usual
market practice for transactions of this nature.
The gross proceeds from the sale of the FT A Units and FT B Units will be used only to finance further
qualifying Canadian exploration expenditures on the Lawyers Property by no later than December 31,
2021, and will qualify as "flow-through mining expenditures" as defined under subsection 127(9) of the
Income Tax Act
(Canada) and subsection 4.721(1) of the
Income Tax Act
(B.C.).
The Shares and Warrants comprising the Units, and the Shares comprising the Compensation Warrants
are subject to a hold period until January 19, 2021, in accordance with applicable securities laws.
About Benchmark Metals Inc.
Benchmark is a Canadian mineral exploration company with its common shares listed for trading on the
TSX Venture Exchange in Canada, the OTCQB Venture Market in the United States, and the Tradegate
Exchange in Europe.
Benchmark is managed by proven resource sector professionals, who have a track
record of advancing exploration projects from grassroots scenarios through to production.
ON BEHALF OF THE BOARD OF DIRECTORS
s/ "John Williamson"
John Williamson
, Chief Executive Officer
For further information, please contact:
Jim Greig, President
Tel: (604) 260-6977
NEITHER TSX VENTURE EXCHANGE NOR ITS REGULATION SERVICES PROVIDER (AS THAT
TERM IS DEFINED IN THE POLICIES OF THE TSX VENTURE EXCHANGE) ACCEPTS
RESPONSIBILITY FOR THE ADEQUACY OR ACCURACY OF THIS RELEASE.
This news release may contain certain "forward looking statements". Forward-looking statements involve
known and unknown risks, uncertainties, assumptions and other factors that may cause the actual
results, performance or achievements of the Company to be materially different from any future results,
performance or achievements expressed or implied by the forward-looking statements. Any forward-
looking statement speaks only as of the date of this news release and, except as may be required by
applicable securities laws, the Company disclaims any intent or obligation to update any forward-looking
statement, whether as a result of new information, future events or results or otherwise. Forward-looking
statements in this news release include, but are not limited to, statements with respect to the second
closing and the Company's ability to obtain disinterested shareholder approval permitting Mr. Sprott to
exercise Warrants notwithstanding such exercise would result in his holding 20% or more of the issued
and outstanding common shares of the Company.
Not for distribution to United States newswire services or for dissemination in the United States.
This news release does not constitute an offer to sell or a solicitation of an offer to buy nor shall there
be any sale of any of the securities in any jurisdiction in which such offer, solicitation or sale would be
unlawful, including any of the securities in the United States of America. The securities have not been
and will not be registered under the United States Securities Act of 1933, as amended (the "
1933
Act
") or any state securities laws and may not be offered or sold within the United States or to, or for
account or benefit of, U.S. Persons (as defined in Regulation S under the 1933 Act) unless registered
under the 1933 Act and applicable state securities laws, or an exemption from such registration
requirements is available
.
Not for distribution to United States newswire services or for dissemination in the United States.
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